q2 fy2021 earnings · though that lifecycle, medallia is there measuring ... digital customer...
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Q2 FY2021 EarningsSeptember 2020
Medallia © Copyright 2020 2
Forward-Looking Statements & Non-GAAP Financial MeasuresThis presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.
Forward-looking statements generally relate to future events or Medallia's future financial or operating performance. In some cases, you can identify forward looking statements because they contain words
such as "may,“ “might,” "will," "should,” "expects," "plans," "anticipates,” “going to,” "could," "intends," "target," "projects," "contemplates," "believes," "estimates," "predicts," "potential" or "continue" or the
negative of these words or other similar terms or expressions that concern Medallia's expectations, strategy, priorities, plans or intentions. Forward-looking statements in this presentation include, but are
not limited to, statements regarding Medallia’s future financial and operating performance, including its outlook and guidance. To the extent possible, our forward-looking statements seek to take into
account the impact of COVID-19. However, the crisis that this pandemic has created is very fluid, and the situation is constantly evolving. If any of the risks or uncertainties related to the forward-looking
statements develop or if any of the assumptions related to the forward-looking statements prove incorrect, actual results could differ materially from those projected, expressed, or implied by our forward-
looking statements. The forward-looking statements contained in this presentation are also subject to other risks and uncertainties, including those more fully described in Medallia filings with the Securities
and Exchange Commission, including our Annual Report on Form 10-K filed with the SEC on March 19, 2020 and our Quarterly Report on Form 10-Q filed with the SEC on June 9, 2020. The forward-
looking statements in this presentation are based on information available to Medallia as of the date hereof, and Medallia disclaims any obligation to update any forward-looking statements, except as
required by law. Actual results may differ materially from those presently reported. All forward-looking statements in this presentation are based on information available to us as of the date hereof.
In addition to financial information presented in accordance with U.S. generally accepted accounting principles (“GAAP”), this presentation includes certain non-GAAP financial measures. These non-GAAP
measures are presented for supplemental informational purposes only and should not be considered a substitute for financial information presented in accordance with GAAP. Our management uses these
non-GAAP financial measures internally in analyzing our financial results and believes they are useful to investors, as a supplement to the corresponding GAAP financial measures, in evaluating our
ongoing operational performance and trends and in comparing our financial measures with other companies in the same industry, many of which present similar non-GAAP financial measures to help
investors understand the operational performance of their businesses. However, it is important to note that the particular items we exclude from, or include in, our non-GAAP financial measures may differ
from the items excluded from, or included in, similar non-GAAP financial measures used by other companies in the same industry. In addition, other companies may utilize metrics that are not similar to
ours.
The non-GAAP financial information is presented for supplemental informational purposes only and is not intended to be considered in isolation or as a substitute for, or superior to, financial information
prepared and presented in accordance with GAAP. There are material limitations associated with the use of non-GAAP financial measures since they exclude significant expenses and income that are
required by GAAP to be recorded in our financial statements. Please see the reconciliation tables at the end of this presentation for the reconciliation of GAAP and non-GAAP results. Management
encourages investors and others to review Medallia’s financial information in its entirety and not rely on a single financial measure.
This presentation contains statistical data, estimates and forecasts that are based on independent industry publications or other publicly available information, as well as other information based on our
internal sources. This information involves many assumptions and limitations, and you are cautioned not to give undue weight to such information. We have not independently verified the accuracy or
completeness of the information contained in the industry publications and other publicly available information. Accordingly, we make no representations as to the accuracy or completeness of that
information nor do we undertake to update such information after the date of this presentation.
Medallia © Copyright 2020 3
Pervasive usage and daily habit3Broad vertical representation1
Medallia is the Market Leader in Experience Management
~840Enterprise
Customers2
Experiences analyzed annually
of customers with 1,000+ users
Calculationsin a single day
Mobile dailyengagement4
Enterprise grade platform
Strong subscription revenue growth at scale
Note: Dollars in millions
1. Rankings are determined by last twelve months revenue; industry descriptions are based on Forbes Media LLC, or Forbes, Global 2000: The World’s Largest Public Companies, June 2018. Information excludes enterprises headquartered in China, a market that Medallia has not materially entered.2. For purposes of calculating our customer count, in situations where a customer has multiple subsidiaries or divisions, each entity that is invoiced as a separate entity is treated as a separate customer.3. Statistics provided as of January 31, 2020.4. As of January 31, 2020. Represents mobile daily active users (DAU) divided by mobile monthly active users (MAU). We define a DAU as a user who logged in and accessed our platform via either of our primary mobile applications,
Medallia Mobile 2 or Medallia Mobile 3, any time in a single day. We define a mobile MAU as a user who logged in and accessed our platform via either of our primary mobile applications, Medallia Mobile 2 or Medallia Mobile 3, any time in the last 30 days as of the date of measurement.
$60.1 $63.2
$67.9 $71.7
$74.5
$79.7
$86.2 $89.0
$92.8
Q2 FY’19 Q3 FY’19 Q1 FY’20Q4 FY’19 Q2 FY’20 Q3 FY’20 Q4 FY’20 Q1 FY’21 Q3 FY’21 Guidance
Q2 FY’21
Quarterly subscription revenueEst.
$94.6-$95.6
8 of the Top 10Global communications and media companies1
5 of the Top 10Global automotive companies1
7 of the Top 10Global banks1
7 of the Top 10Global hospitality companies1
6 of the Top 10Global insurance companies1
50%+ ~45%
6.1B 8T
Medallia © Copyright 2020 4
Go To Market Partner EcosystemGlobal SIs, Consulting
and Market ResearchGlobal ISVs
Vertical and Technology
PartnersRegional and Delivery
Partners
Medallia © Copyright 2020 5
CRM POSERP
Operational Data
Observed Behavior
Solicited Feedback
Unstructured
Structured
Unsolicited Feedback
Messaging
Social
Voice
Employee
IOT signals Visit Patterns Event Data
AI and Machine Learning | Text Analytics In-
Memory Analytics | NLP | Journeys | Profiles
Dynamic Org Hierarchy
In-Memory Analytics
Personal Dashboards and Reports
Reply
Process Change
Product IdeaCongratulations
Escalate
HRIS
Capture Every Signal Analyze and Predict Behavior Operationalize and Drive Action
Video
AI-Powered Experience Management Drives ROI
Medallia © Copyright 2020 6
15%Customer Engagement Systems Social Media
Employee Signals
Robust Signal Platform - Customers on Average Integrate with 25 Systems
Enterprise Operational/Transactional Data
MKTG/CRM ITSM/ERP HCM/HRMS OTHER
Other Signals >80%
Surveys<20%
eCommerce
Systems
Legacy
Systems
100s of sites
Contact
Centers
25
Integrations on Average
Medallia © Copyright 2020 7
Consolidate Siloed Vendors Into Medallia Drives ROI
Capture Signals Analyze Drive Action
Videos
Surveys
Social Listening
CustomerCommunityMessaging
Platform
Web-basedChat Platforms
CustomerSuccessPlatforms
Voice
Employee Feedback
In Product Feedback
PerformanceAgent
Coaching
Medallia © Copyright 2020 8
Connecting CX and EX Drives ROI
The Forrester WaveTM
Customer Feedback Management Platforms, Q1 2020
“Medallia reference clients praise the vendor for its
technology and ability to grow and scale with their
business. They are also fond of the vendor’s ability
to drive engagement in the platform at scale: Its
reference clients had upward of 50,000 dashboard
users — the most of any vendor in this evaluation.”
The Forrester Wave™ is copyrighted by Forrester Research, Inc. Forrester and Forrester Wave are trademarks of Forrester Research, Inc. The Forrester Wave is a graphical representation of Forrester's call on a market and is plotted using a detailed spreadsheet with exposed scores, weightings, and comments. Forrester does not endorse any company, product, or service depicted in the Forrester Wave. Information is based on best available resources. Opinions reflect judgment at the time and are subject to change.
Source: The Forrester Wave TM: Customer Feedback Management Platforms, Q1 2020 and The Forrester New Wave TM: EX Management Platforms for Large Enterprises
EX Management Platforms For LargeEnterprises, Q1 2020
The Forrester New WaveTM
“Medallia’s reference customers praised the solution
for its ability to perform analysis and focus attention in
the areas that matter most, the flexibility of the platform,
and the support and guidance they received from the
vendor.”
Medallia © Copyright 2020 9
Medallia is Mission Critical…Driving High Financial Return
“Medallia has had a huge impact… from the time
of purchase of a Samsung product, to setup,
install it, use, it, need help with it, all the way
though that lifecycle, Medallia is there measuring the entire customer journey. It’s now become a
part of the DNA of the company.”
Maintaining a strong customer experience in crisis requires rapid research to understand changing dynamics and new pain points as well as agile innovation to
address them. Customer leaders who master that approach will create value for consumers . - McKinsey, April 2020 (1)
“Medallia has opened up a world of real
customer feedback and inspired us to
improve important processes that have a
quantifiable impact on our bottom
line.”
(1 )“Adapting customer experience in the time of coronavirus”
“Medallia’s tools have transformed our
focus on our customers’ needs. For us, the
verbatim customer feedback is gold.”
“We’ve reduced incoming customer calls
by several million. When you account for
the cost per call, the payback on our
investment in Medallia was realized within
one month.”
“We’ve tracked 40 million fewer
issues that customers have
experienced than last year.”
"Thanks to the voice of customer data
captured by Medallia, we are able to
identify and eliminate bottlenecks in our
digital customer journeys resulting in
increased conversion and lower exit
rates.”
Medallia © Copyright 2020 10
6x ROI over 3 years
<6 month payback
Forrester believes the findings are relevant and
robust for both smaller and larger organizations.
Key findingsTotal economic impact of Medallia Experience Cloud
$36M3 yearimpact
Breakdown:
Based on six customer interviews
• $20 million from net income due to customer experience improvements
• $14 million from operational efficiencies
• $2 million from previous solution cost avoidance
Medallia Drives Proven Impact
Source: Forrester April 2018 report, “The Total Economic Impact TM of Medallia Experience Cloud," which we commissioned.
Medallia © Copyright 2020 11
Top Global Brands Run on MedalliaBanking and
financial servicesEnergy, industrial and
servicesAutomotive and transportation
Retail and consumer goods
InsuranceTechnology,
telecommunications and media
Gap, Inc.
Hospitality and restaurants
Healthcare and life sciences
Medallia © Copyright 2020 12
Broad Vertical Representation
Cumulative ACV = SaaS + Managed Services as of January 31, 2020
Finance and Banking29%
Technology, Manufacturing and
Services17%
Communications, Media and Telecom
12%
Insurance6%
Hospitality9%
Retail and Auto20%
Other7%
Medallia © Copyright 2020 13
Platform Provides Cross-Sell and Up-Sell Opportunities with Multiple Incremental Offerings
Employee Experience
Social Promote
Text Analytics (Theme
Explorer)
Digital Web
Medallia Athena
Predictions
Experience Data
Platform (XDP)
Conversations
Service Clouds
Sales Clouds
Customer Success
Loyalty
Point-of-Sale
Systems
Voice (Siri, Alexa)
Contact Centers
Operational Support Systems
IoT Systems
HCM Systems
ERP Systems
Marketing Clouds
1. Based on the average attach rate of a representative sample of our customers as of our fiscal year ended January 31, 2020.2. Based on our calculations of potential customer spend, determined based on assumptions regarding our customer base and its spending habits and potential, as well as the average customer spend on certain add-on
modules, all as of our fiscal year ended January 31, 2020.
Promoter
Integrations
Add-ons / Up-sell
Core Platform
System Integrations
ReportingMobile App
Medallia Voices
Pre-Packaged Solutions
Digital (IoT, in app)
Surveys
OrgSync
Analytics
CXProfiles
CX Journeys
Social
Cross-sell opportunities of at least $3 for every $1 spent on the platform2
Average attach rate today is only 3 modules1
14 modules with multiple SKUs
Zingle
Ideas
Video
MedalliaSpeech
Agent Coaching
and Performance
Medallia © Copyright 2020 14
Annual Customer Count Quarterly Customer Count
Enterprise Customer Count
486 508
543 565
613
698
757782
839
Q4 FY’19Q2 FY’19 Q1 FY’21Q3 FY’19 Q2 FY’20Q1 FY’20 Q3 FY’20 Q4 FY’20 Q2 FY’21
+37%
452
543
757
FY’18 FY’19 FY’20
Medallia © Copyright 2020 15
Annual Total Revenue(in millions)
Quarterly Total Revenue(in millions)
Total Revenue Growth at Scale
0
10
20
30
40
50
60
70
80
90
100
110
120
9% 8%
90%
Q3 FY’19
$95.7
Q2 FY’20
$112.7
90%92%
89%
8%10%
Q2 FY’19 Q2 FY’21
91%
10%
$86.4
9%
Q4 FY’19
11%
Q1 FY’20
10%
90%
92%
Q1 FY’21Q3 FY’20
90%
Q4 FY’20
91%
10%
$81.2
$93.6
$103.1
$110.1
$115.5
$75.4
0
50
100
150
200
250
300
350
400
450
9%
90%
10%
$402.5
10%
FY’18
91%
FY’19
90%
FY’20
$261.2
$313.6
+20%
+28%
*High visibility ~ 90% of total revenue is recurring
* Based on trailing twelve months
Professional Services Implementation RevenueSubscription Revenue + Managed Services Revenue
Medallia © Copyright 2020 16
Annual Revenue(in millions)
Quarterly Revenue(in millions)
Compelling Subscription Revenue Growth at Scale
$201.8
$246.8
$312.2
FY’20FY’18 FY’19
+22%
+26%
Est.$94.6 - $95.6
$60.1 $63.2
$67.9
$71.7 $74.5
$79.7
$86.2 $89.0
$92.8
Q4 FY’19 Q4 FY’20Q3 FY’20Q2 FY’19 Q3 FY’19 Q1 FY’20 Q2 FY’20 Q1 FY’21 Q3 FY’21 Guidance
Q2 FY’21
Medallia © Copyright 2020 17
Annual Non-GAAP Operating Margin
Quarterly Non-GAAP Operating Margin
Non-GAAP Operating Margin
Q3 FY’20
3%
Q3 FY’19Q2 FY’19 Q4 FY’19 Q1 FY’21Q2 FY’20Q1 FY’20 Q4 FY’20 Q2 FY’21
2%
Q3 FY’21 Guidance
-28%
-11%
3%2%
-2% -2%
0%
-20%
FY’19FY’18 FY’20
-15%
-1%
Est. 0.2% to 0.6%
Medallia © Copyright 2020 18
Annual SaaS Deferred Revenue(in millions)
Quarterly SaaS Deferred Revenue(in millions)
SaaS Deferred Revenue
$136.3
$175.4
$222.9
FY’18 FY’19 FY’20
$109.1 $106.4
$175.4
$156.2
$145.4 $141.8
$222.9
$192.9
$179.9
Q4 FY’19 Q2 FY’20Q1 FY’20Q2 FY’19 Q3 FY’19 Q3 FY’20 Q4 FY’20 Q1 FY’21 Q2 FY’21
+24%
Medallia © Copyright 2020 19
Annual Cash Flow(in millions)
Quarterly Cash Flow(in millions)
Cash Flow from Operations
$(34.6)
$(21.0)
$19.5 $18.2
$(20.9)$(18.4)
$19.5
$23.1
$(19.4)
Q4 FY’20Q2 FY’20Q1 FY’20Q2 FY’19 Q3 FY’19 Q3 FY’20Q4 FY’19 Q1 FY’21 Q2 FY’21
$(15.2)
$(1.6)
FY’19 FY’20
Medallia © Copyright 2020 20
Long-Term Margin Framework(1)
1. See appendix for a reconciliation of GAAP to Non-GAAP to financial measures. 2. Long-Term Target model is forward-looking, and subject to significant business, economic, regulatory and competitive uncertainties and contingencies, many of which are beyond the control of
the Company and its management, and are based upon assumptions with respect to future decisions, which are subject to change. Actual results will vary and those variations may be material. For discussion of some of the important factors that could cause these variations, please consult the “Risk Factors” section of our Annual Report on Form 10-K filed with the SEC on March 19, 2020 and our Quarterly Report on Form 10-Q filed with the SEC on June 9, 2020, both of which may be obtained on the Investor Relations section of Medallia’s website (https://investor.medallia.com/financials/sec-filings/default.aspx). Nothing in this presentation should be regarded as a representation by any person that these goals will be achieved and the Company undertakes no duty to update its goals, except as required by law.
FY’19 FY’20 LT Target2
Subscription revenue $246.8M $312.2M
Subscription revenue growth 22% 26% 25% - 30%
Total revenue $313.6M $402.5M
Total revenue growth 20% 28%
Non-GAAP operating income ($47.7M) ($2.4M)
Non-GAAP operating margin (15%) (1%) 20% plus
Medallia © Copyright 2020 21
Investor Relations
Address:
Contact:
Email:
Medallia, Inc.575 Market StreetSan Francisco, CA 94105
Carolyn BassMarket Street Partners
Medallia © Copyright 2020
Appendix
Medallia © Copyright 2020 23
GAAP to Non-GAAP Reconciliation
Note: Totals may not sum due to rounding
$MM except where noted Q2 FY'19 Q3 FY'19 Q4 FY'19 Q1 FY'20 Q2 FY'20 Q3 FY'20 Q4 FY'20 Q1 FY'21 Q2 FY'21 FY'18 FY'19 FY'20
Subscription Gross Profit Reconciliation
Total Subscription Revenue 60.1 63.2 67.9 71.7 74.5 79.7 86.2 89.0 92.8 201.8 246.8 312.2
GAAP Subscription Gross Profit 48.1 51.3 55.3 58.3 59.8 63.5 69.2 71.6 73.7 165.4 198.8 250.8
(+) Stock-based compensation expense 0.3 0.3 0.2 0.3 0.9 0.9 1.0 0.9 0.9 0.4 1.1 3.1
(+) Employer payroll tax expense related to stock-based compensation 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.1 0.1 0.0 0.0 0.0
(+) Amortization of acquired intangibles assets 0.0 0.0 0.0 0.0 0.3 0.6 0.9 1.0 1.4 1.0 0.4 1.9
Non-GAAP Subscription Gross Profit 48.5 51.7 55.5 58.6 61.0 65.0 71.1 73.6 76.1 166.8 200.4 255.7
GAAP Subscription Gross Margin 80.1% 81.1% 81.4% 81.2% 80.3% 79.6% 80.4% 80.5% 79.4% 82.0% 80.6% 80.3%
(+) Stock-based compensation expense % 0.5% 0.5% 0.3% 0.4% 1.2% 1.2% 1.1% 1.0% 1.0% 0.2% 0.5% 1.0%
(+) Employer payroll tax expense related to stock-based compensation % 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.1% 0.1% 0.0% 0.0% 0.0%
(+) Amortization of acquired intangibles assets % 0.1% 0.1% 0.1% 0.1% 0.4% 0.8% 1.0% 1.1% 1.5% 0.5% 0.1% 0.6%
Non-GAAP Subscription Gross Margin 80.7% 81.7% 81.8% 81.7% 81.9% 81.5% 82.5% 82.7% 82.0% 82.6% 81.2% 81.9%
Gross Profit Reconciliation
Total Revenue 75.4 81.2 86.4 93.6 95.7 103.1 110.1 112.7 115.5 261.2 313.6 402.5
GAAP Gross Profit 45.9 51.8 57.1 61.0 60.8 64.5 71.0 73.1 74.4 165.4 197.7 257.3
(+) Stock-based compensation expense 1.0 0.9 0.8 0.8 3.6 3.7 3.8 3.6 3.7 2.7 3.5 11.9
(+) Employer payroll tax expense related to stock-based compensation 0.0 0.0 0.0 0.0 0.0 0.1 0.0 0.3 0.2 0.0 0.0 0.1
(+) Amortization of acquired intangibles assets 0.0 0.0 0.0 0.0 0.3 0.6 0.9 1.0 1.4 1.0 0.4 1.9
Non-GAAP Gross Profit 46.9 52.7 57.9 61.9 64.7 68.9 75.7 78.0 79.6 169.1 201.6 271.2
GAAP Gross Margin 60.8% 63.8% 66.1% 65.2% 63.5% 62.6% 64.5% 64.9% 64.4% 63.3% 63.0% 63.9%
(+) Stock-based compensation expense % 1.4% 1.1% 0.9% 0.9% 3.7% 3.5% 3.5% 3.2% 3.2% 1.0% 1.1% 3.0%
(+) Employer payroll tax expense related to stock-based compensation % 0.0% 0.0% 0.0% 0.0% 0.0% 0.1% 0.0% 0.2% 0.1% 0.0% 0.0% 0.0%
(+) Amortization of acquired intangibles assets % 0.1% 0.1% 0.0% 0.0% 0.3% 0.6% 0.8% 0.9% 1.2% 0.4% 0.1% 0.5%
Non-GAAP Gross Margin 62.2% 64.9% 67.0% 66.1% 67.6% 66.8% 68.8% 69.2% 68.9% 64.7% 64.3% 67.4%
Medallia © Copyright 2020 24
GAAP to Non-GAAP Reconciliation
Note: Totals may not sum due to rounding
$MM except where noted Q2 FY'19 Q3 FY'19 Q4 FY'19 Q1 FY'20 Q2 FY'20 Q3 FY'20 Q4 FY'20 Q1 FY'21 Q2 FY'21 FY'18 FY'19 FY'20
R&D Expenses
GAAP R&D 22.4 21.0 19.7 19.6 22.7 26.3 27.3 32.4 27.8 86.4 86.3 96.0
(-) Stock-based compensation expense (1.8) (1.7) (1.7) (1.6) (3.7) (6.3) (6.6) (11.5) (4.7) (5.2) (7.6) (18.2)
(-) Employer payroll tax expense related to stock-based compensation 0.0 0.0 0.0 0.0 0.0 0.0 (0.2) (0.8) (0.4) 0.0 0.0 (0.2)
(-) Acquisition-related costs 0.0 0.0 0.0 0.0 0.0 0.0 (0.0) (0.0) 0.0 0.0 0.0 (0.0)
Non-GAAP R&D 20.7 19.3 18.0 18.0 19.0 20.0 20.5 20.1 22.7 81.2 78.7 77.6
Non-GAAP R&D % of Revenue 27.4% 23.8% 20.8% 19.3% 19.9% 19.4% 18.6% 17.8% 19.6% 31.1% 25.1% 19.3%
S&M Expenses
GAAP S&M 38.6 34.2 30.4 33.6 46.5 47.1 53.6 52.0 51.9 110.0 138.7 180.7
(-) Stock-based compensation expense (1.9) (1.6) (1.8) (1.5) (8.5) (8.9) (9.6) (9.3) (8.7) (4.9) (6.8) (28.5)
(-) Employer payroll tax expense related to stock-based compensation 0.0 0.0 0.0 0.0 0.0 (0.0) (0.3) (0.7) (0.6) 0.0 0.0 (0.3)
(-) Amortization of acquired intangibles assets 0.0 0.0 0.0 0.0 0.0 (0.1) (0.3) (0.4) (0.7) 0.0 0.0 (0.4)
(-) Acquisition-related costs 0.0 0.0 0.0 0.0 0.0 0.0 (0.0) (0.1) 0.0 0.0 0.0 (0.0)
Non-GAAP S&M 36.7 32.7 28.6 32.1 38.0 38.0 43.3 41.5 41.9 105.1 131.9 151.4
Non-GAAP S&M % of Revenue 48.7% 40.2% 33.1% 34.3% 39.7% 36.8% 39.3% 36.8% 36.3% 40.2% 42.0% 37.6%
G&A Expenses
GAAP G&A 12.4 13.0 16.3 9.8 30.1 32.8 22.8 21.5 29.1 40.2 53.2 95.5
(-) Stock-based compensation expense (1.8) (2.4) (3.9) (4.0) (19.5) (18.3) (9.1) (7.4) (7.5) (5.5) (10.0) (50.9)
(-) Employer payroll tax expense related to stock-based compensation 0.0 0.0 0.0 0.0 0.0 (0.5) (0.3) (0.4) (0.7) 0.0 0.0 (0.8)
(-) Restructuring and other 0.0 (1.1) (3.4) 4.1 0.0 0.0 (0.5) 0.0 (7.7) 0.0 (4.5) 3.5
(-) Acquisition-related costs 0.0 0.0 0.0 (0.1) (0.6) (1.1) (1.0) (0.8) (0.8) 0.0 0.0 (2.8)
Non-GAAP G&A 10.6 9.6 8.9 9.8 10.0 12.9 11.9 12.9 12.5 34.7 38.8 44.6
Non-GAAP G&A % of Revenue 14.1% 11.8% 10.4% 10.4% 10.5% 12.5% 10.8% 11.5% 10.8% 13.3% 12.4% 11.1%
Operating Income/(Loss) Reconciliation
GAAP Operating Income/(Loss) (27.6) (16.5) (9.3) (2.0) (38.5) (41.7) (32.8) (32.8) (34.5) (71.1) (80.4) (114.9)
(+) Stock-based compensation expense 6.5 6.5 8.2 8.0 35.2 37.2 29.2 31.8 24.6 18.2 27.9 109.5
(+) Employer payroll tax expense related to stock-based compensation 0.0 0.0 0.0 0.0 0.0 0.7 0.8 2.2 1.8 0.0 0.0 1.5
(+) Amortization of acquired intangibles assets 0.0 0.0 0.0 0.0 0.3 0.7 1.2 1.4 2.1 1.0 0.4 2.3
(+) Restructuring and other 0.0 1.1 3.4 (4.1) 0.0 0.0 0.5 0.0 7.7 0.0 4.5 (3.5)
(+) Acquisition-related costs 0.0 0.0 0.0 0.1 0.6 1.1 1.0 0.9 0.8 0.0 0.0 2.8
Non-GAAP Operating Income/(Loss) (21.0) (8.8) 2.4 2.0 (2.4) (2.0) 0.0 3.5 2.5 (51.9) (47.7) (2.4)
GAAP Operating Margin -36.6% -20.3% -10.8% -2.2% -40.2% -40.4% -29.8% -29.1% -29.9% -27.2% -25.6% -28.6%
(+) Stock-based compensation expense % 8.6% 8.0% 9.5% 8.5% 36.8% 36.0% 26.5% 28.2% 21.3% 7.0% 8.9% 27.2%
(+) Employer payroll tax expense related to stock-based compensation % 0.0% 0.0% 0.0% 0.0% 0.0% 0.6% 0.8% 2.0% 1.5% 0.0% 0.0% 0.4%
(+) Amortization of acquired intangibles assets % 0.1% 0.1% 0.0% 0.0% 0.3% 0.7% 1.1% 1.3% 1.8% 0.4% 0.1% 0.6%
(+) Restructuring and other % 0.0% 1.3% 4.0% -4.3% 0.0% 0.0% 0.5% 0.0% 6.7% 0.0% 1.4% -0.9%
(+) Acquisition-related costs % 0.0% 0.0% 0.0% 0.1% 0.6% 1.1% 0.9% 0.8% 0.7% 0.0% 0.0% 0.7%
Non-GAAP Operating Margin -27.9% -10.9% 2.7% 2.1% -2.5% -2.0% 0.0% 3.1% 2.2% -19.9% -15.2% -0.6%
Thank You